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2019 (8) TMI 1557 - Tri - Insolvency and BankruptcyMaintainability of application - initiation of CIRP - Corporate Debtor failed to make repayment of its dues - existence of debt and dispute or not - HELD THAT:- In terms of Section 9(5)(ii)(d) of the Code Adjudicating Authority shall reject the application if notice of dispute has been received by the operational creditor. Section 9(5)(ii)(d) refers to the notice of an existing dispute that has been received, as it has to be read with Section 8(2)(a) of the Code. The moment there is existence of a pre-existing dispute, the operational debtor gets out of the clutches of the rigors of the Code - It is no longer Res-Integra that the definition of dispute is inclusive and not exhaustive. Dispute has been given wide meaning so as to cover all disputes on debt, default etc. and not be limited to only pending suit or a record of a pending arbitration. It is now a settled proposition of law that where there is "existence of dispute" prior to the issuance of notice under Section 8, the petition under Section 9 preferred by the Operational Creditor is not maintainable - there is also no dispute that this is not the forum to examine and adjudicate as to what extent the claim of the petitioner is admissible as due and recoverable. Neither the Tribunal in the proceedings under Section 9 will examine the merits of the respective disputes. Moreover, even the adequacy of dispute is not to be seen. It is only to be seen whether the dispute raised by the corporate debtor qualifies as a 'dispute' as defined under sub-section (6) of Section 5 of the Code. Whether there is an existence of a dispute between the parties that would fall within the inclusive definition contained in Section 5(6) of the Code? - HELD THAT:- In the present case admittedly, respondent has relied upon its reply to the demand notice issued on 28.12.2018 under Section 8(2) of the Code bringing to the notice of the petitioner the existence of dispute in respect of the claimed operational debt - Besides respondent has placed on record various correspondences and debit notes to prove that the dispute in the reply to the demand notice was not raised for the first time but pre-existed much prior to the Section 8 notice. There is pre-existing dispute and there is also a confusion on the actual amount of default. Though the invoices pertain to the year 2015, there was no effective pursuance for a long period from 2015 till end of 2018. The various correspondences placed on record show that dispute was not raised for the first time to evade liability but certainly preexisted much prior to the issuance of notice under Section 8 of the Code. The email dated 03.09.2015 reveals that the respondent requested for the accounts of the petitioner to confirm the balance which was never issued. There are allegations of non-conciliation of accounts despite request. In the present case notice under Section 8 was duly replied within the period prescribed by bringing to the notice of the operational creditor the existence of dispute. Materials placed before us show that dispute was raised prior to the issuance of notice under Section 8 of the Code. The claim of operational debt in question is not free from dispute. There is substance and plausible contention in the pleadings of both sides, which necessitates investigation - Respondent has raised dispute with enough particulars to qualify as a dispute as defined under sub-section (6) of Section 5 of the Code. Application dismissed.
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